Share transfer is an important process whereby shareholders to sell or transfer their shares in a company to other individuals or organizations. It ensures the availability of the stock for different buyers and investors by keeping the market liquid. Nevertheless, there are a lot of rules and regulations which are in place in order to make share transfer a transparent process and take into account the interests of all shareholders.
CompRegi has experienced the intricacies associated with the share transfer process, and we know this all too well. The entire procedure will be run by the legality team, who are experienced in law regulations and will assist you in being compliant with the procedure.
We at Compregi believe in complete transparency in the complete registration process of your company. Below mentioned cost structure includes all the necessary government fees required at multiple stages of registration.
Share transfer can be described as the free willed surrender of the rights and duties of a company member to an individual who would like to acquire the membership represented by a share in the company by a current shareholder who no longer wishes to have a membership in the company. This function is by the Companies Act, 2013, legislation that deals with securities transfer and transmission.
Under the guidance of Section 56 of the Companies Act, 2013, the transfer of shares has to be recorded within 30 days since the instrument of transfer is delivered to the company. The sale of shares is a contractual process, and therefore both the seller and the buyer need to go through the procedure for a regular and valid transaction.
At CompRegi, we provide guides for our clients through the shares transfer process while by the sections of the Companies Act which guarantee the clients a low workload and free from all complexities.
The following documents are required for a share transfer:
The AOA, one of a company’s foundational documents, is the principal document in the share transfer process. The AOA may contain specific provisions related to the transfer of shares, such as:
The share transfer process is crucial and should be started once the AOA is studied and understood carefully to ensure the compliance with the company’s internal rules and regulations.
At CompRegi, we review the AOA document in detail and then guide our clients step-by-step through the share transfer process that meets the demands of the specific document of the respective organization so that the transfer goes as smoothly as possible without any legal mistakes from your side.
For the company: The least one should have is Rs. 25,000 maximum, up to Rs.5,00,000
For the defaulting officer: At least Rs.10,000/-. From 0 to Rs. 10000 and a maximum of Rs.1,00,000
Mainly, shares can be transferred to anyone interpersonally unless the Articles of Association of the company mention specific restrictions like a right of first refusal or pre-emption rights in favor of existing shareholders.
Yes, on the share transfer deed, the stamp duty is obligatory as per the Indian Stamp Act, and the notifications on stamp duty are in force in the concerned state. The current stamp duty rate for share transfer is 0.25 Indian rupees for every hundred Indian rupees of the value of each share or part thereof.
Transferable partly paid shares also exist. Nonetheless, a notification has to be sent to the transferee regarding the amount due on the shares and an NOC to be gotten from the transferee within 2 weeks of receiving the notification.